10.5 Letter Agreement dated July 29, 1999 by and between Regent Group, Inc.
and Xxxxxxxxxxxxx.xxx, LLC.
July 29, 1999
Xx. Xxxxx X. Xxxxxx
Xxxxxxxxxxxxx.xxx, LLC
X.X. Xxx 0000
Xxxxxxxxxxxxxxx, XX 00000
Dear Xx. Xxxxxx:
In connection with the possible transaction ("Transaction") between
Regent Group, Inc. together with its subsidiaries (the "Recipient") and
Xxxxxxxxxxxxx.xxx, LLC, (the "Company"), the Recipient has requested access to
certain information, properties, and personnel of the Company.
In consideration for and as a condition to the Company's furnishing
access to such information, properties, and personnel of the Company as the
Company, in its sole discretion, agrees to make available to the Recipient, the
Recipient agrees as follows:
1. CONFIDENTIAL AND PROPRIETARY NATURE OF THE INFORMATION
The Recipient acknowledges the confidential and proprietary
nature of the Confidential Information (as defined below), agrees to hold and
keep the same as provided in this letter agreement, and otherwise agrees to each
and every restriction and obligation in this letter agreement
2. CONFIDENTIAL INFORMATION
As used in this letter agreement, the term "Confidential
Information" means and includes any and all:
(a) trade secrets concerning the business and affairs of the
Company (which includes the financial materials provided to the Recipient by
Company), product specifications, data, know-how, formulae, compositions,
processes, designs, sketches,. photographs, graphs, drawings, samples,
inventions and ideas, past, current, and planned research and development,
current and planned manufacturing or distribution methods and processes,
customer lists, current and anticipated customer requirements, price lists,
market studies, business plans, computer software and program (including object
code and source code), computer software and database technologies, system,
structures and architectures (and related processes, formulae, composition,
improvements, devices, know-how, inventions, discoveries, concepts, ideas,
designs, methods and information), and any other information, however
documented, that is a trade secret within the meaning of applicable state trade
secret law, and;
Xxxxx Xxxxxx
Confidentiality Agreement
July 29, 1999
(b) information concerning the business and affairs of the
Company (which includes historical financial statements, financial projections
and budgets, historical and projected sales, capital spending budgets and plans,
the names and backgrounds of key personnel, personnel training techniques and
materials), however documented, that has been or may hereafter be provided or
shown to the Recipient by the Company or by the directors, officers, employees,
agents, consultants, advisors, or other representatives including legal counsel,
accountants and financial advisors ("Representatives") of the Company (the
"Company Representatives") or is otherwise obtained from review of Company
documents or property or discussions with Company Representatives by the
Recipient or the Recipient's Representatives (including current or prospective
financing sources) or Representatives of the Recipient's Representatives
irrespective of the form of the communication, and also includes all notes,
analyses, compilations, studies, summaries, and other material prepared by the
Recipient or the Recipient's Representatives containing or based, in whole or in
part, on any information included in the foregoing. Any trade secrets of the
Company will also be entitled to all of the protections and benefits under
applicable state trade secret law and any other applicable law. If any
information that the Company deems to be a trade secret is found by a court of
competent jurisdiction not to be a trade secret for purposes of this letter
agreement, then such information will be considered Confidential Information for
purposes of this letter agreement. In the case of trade secrets, the Recipient
hereby waives any requirement that the Company submit proof of the economic
value of any trade secret or post a bond or other security.
3. RESTRICTED USE OF CONFIDENTIAL INFORMATION
The Recipient agrees that the Confidential Information (a)
will be kept confidential by the Recipient and the Recipient's Representatives
and (b) without limiting the foregoing, will not be disclosed by the Recipient
or the Recipients Representatives to any person (including current or
prospective financing sources) except with the specific prior written consent of
Xxxxx X. Xxxxxx (the "Company Contact") or except as expressly otherwise
permitted by the terms of this letter agreement. It is understood that the
Recipient may disclose Confidential Information to only those of the Recipient's
Representatives who (i) require such material for the purpose of evaluating a
possible Transaction (but to the extent practicable, only such part that is so
required and without revealing the possible Transaction), and (ii) are informed
by the Recipient of the confidential nature of the Confidential Material and the
obligations of this letter agreement. The Recipient Xxxxxx agrees that the
Recipient and the Recipient's Representatives will not use any of the
Confidential Information either for any reason or purpose other than to evaluate
a possible Transaction or in any way detrimental to the Company (it being
acknowledged that any use other than evaluation of and negotiating the possible
Transaction will be deemed detrimental). The Recipient also agrees to be
responsible for enforcing the terms of this letter agreement as to the
Recipient's Representatives and the confidentiality of the Confidential
Information and to take such action, legal or otherwise, to the extent necessary
to cause them to comply with the terms and conditions of this letter agreement
and
Page 2
Xxxxx Xxxxxx
Confidentiality Agreement
July 29, 1999
thereby prevent any disclosure of the Confidential Information by any of the
Recipients Representatives (including all actions that the Recipient would take
to protect its own trade secrets and confidential information).
4. NONDISCLOSURE OF POSSIBLE TRANSACTION
Except as permitted by the previous paragraph and except as
expressly permitted by a definitive acquisition agreement, if any, entered into
by the Recipient for the acquisition of the Company, neither the Recipient nor
the Recipient's Representatives will disclose to any person (including another
prospective purchaser who has been provided Confidential Information) the fact
that the Confidential Information has been made available to the Recipient or
the Recipient's Representatives or that the Recipient or the Recipients
Representatives have inspected any portion of the Confidential Information.
Except with the prior written consent of the other party and except as expressly
permitted by a definitive acquisition agreement, if any, entered into by the
Recipient for the acquisition of the Company, neither the Recipient nor
Recipient's Representatives will disclose the fact that any discussions or
negotiations are taking place concerning a possible Transaction, including the
status of such discussions or negotiations.
5. COMPANY CONTACT
All requests 'by the Recipient or the Recipients
Representatives for Confidential Information, meetings with Company personnel or
Company Representatives, or inspection of the Company's properties must be made
to the Company Contact.
6. EXCEPTIONS
All of the foregoing obligations and restrictions do not apply
to that part of the Confidential Information that the Recipient demonstrates (a)
was or becomes generally available to the public other than, as a result of a
disclosure by the Recipient or the Recipient's Representatives or (b) was
available, or becomes available, to the Recipient on a non-confidential basis
prior to its disclosure to the Recipient by the Company or a Company
Representative, but only if (i) the source of such information is not bound by
the Confidentiality Agreement with the Company or is not otherwise prohibited
from transmitting the information to the Recipient or the Recipient's
Representatives by a contractual, legal, fiduciary, or other obligation and (ii)
the Recipient provides the Company with written notice of such prior possession
either (A) prior to the execution and delivery of this letter agreement or (B)
if the Recipient later becomes aware of (through disclosure to the Recipient or
otherwise through the Recipients work on the Transaction) any aspect of the
Confidential Information of which the Recipient had prior possession, promptly
upon the Recipient becoming aware of such aspect
Page 3
Xxxxx Xxxxxx
Confidentiality Agreement
July 29, 1999
7. LEGAL PROCEEDINGS
If the Recipient or any of the Recipient's Representatives are
requested or become legally compelled (by oral questions, interrogatories,
requests for information or documents, subpoena, civil or criminal investigative
demand, or similar process) or is required by a regulatory body to make any
disclosure that is prohibited or otherwise constrained by this letter agreement,
the Recipient or such Representative, as the case may be, will provide the
Company with prompt notice of such request so that it may seek an appropriate
protective order or other appropriate remedy. Subject to the foregoing, the
Recipient or such Representative may furnish that portion (and only that
portion) of the Confidential Information that, in the written opinion of its
counsel reasonably acceptable to the Company, the Recipient is legally compelled
or is otherwise required to disclose or else stand liable for contempt or suffer
other material censure or material penalty; provided, however, that the
Recipient and the Recipient's Representatives must use reasonable efforts to
obtain reliable assurance that confidential treatment will be accorded any
Confidential Information so disclosed
8. RETURN OF CONFIDENTIAL INFORMATION
If the Recipient determines that it does not wish to proceed
with a Transaction (the Recipient will promptly notify the Company Contact of
such decision) or if the Company notifies the Recipient that it does not wish
the Recipient to consider the Transaction any further, then (a) the Recipient
(i) will promptly deliver to the Company Contact all documents or other
materials furnished by the Company or any Company Representative to the
Recipient or the Recipient's Representatives constituting Confidential
Information, together with all copies and summaries thereof in the possession or
under the control of the Recipient or the Recipients Representatives, and (ii)
will destroy materials generated by the Recipient or the Recipients
Representatives that include or refer to any part of the Confidential
Information, without retaining a copy of any such material or (b) alternatively,
if the Company Contact requests or gives his prior written consent to the
Recipients request, the Recipient will destroy all documents or other matters
constituting Confidential Information in the possession or under the control of
the Recipient or the Recipients Representatives. Any such destruction pursuant
to the foregoing must be confirmed by the Recipient in writing to the Company
(such confirmation must include a list of the destroyed materials).
9. NO OBLIGATION TO NEGOTIATE A DEFINITIVE AGREEMENT
The Company and its shareholders reserve the right, in their
sole discretion, to reject any and all proposals made by the Recipient or the
Recipient's Representatives with regard to a Transaction and to terminate
discussions and negotiations with the Recipient and the Recipient's
Representatives at any time. Without limiting the preceding sentence, nothing in
this letter agreement requires either the Recipient or the Company or its
shareholders to enter into a
Page 4
Xxxxx Xxxxxx
Confidentiality Agreement
July 29, 1999
Transaction or to negotiate such transaction for any specified period of time.
10. NO REPRESENTATIONS OR WARRANTIES
The Company retains the right to determine, in its sole
discretion, what information, properties, and personnel it wishes to make
available to the Recipient, and neither the Company nor its Representatives make
any representation or warranty (express or implied) concerning the completeness
or accuracy of the Confidential Information, except pursuant to representations
and warranties the may be made to the Recipient in a definitive acquisition
agreement for a Transaction if, when, and as executed and subject to such
limitations and restrictions as may be specified therein. The Recipient also
agrees that if the Recipient determines to engage in a Transaction, the
Recipient's determination will be based solely on the terms of such definitive
acquisition agreement and on the Recipients own investigation, analysis, and
assessment of the Company. Moreover, unless and until such a definitive written
agreement is entered into, neither the Company nor the Recipient will be under
any legal obligation of any kind with respect to such a Transaction except for
the matters specifically agreed to in this letter agreement or in another
written agreement
11. REMEDIES
The Recipient agrees to indemnify and hold the Company and its
shareholders harmless from any damages, loss, cost, or liability (including
legal fees and the cost of enforcing this indemnity) a rising out of or
resulting from any unauthorized use or disclosure by the Recipient or the
Recipients Representatives of the Confidential Information or other violation of
this letter agreement. In addition, because an award of money damages (whether
pursuant to the foregoing sentence or otherwise) would be inadequate for any
breach of this letter agreement by the Recipient or the Recipients
Representatives and any such breach would cause the Company irreparable harm,
the Recipient also agrees that, in the event of any breach or threatened breach
of this letter agreement, the Company will also be entitled, without the
requirement of posting a bond or other security, to equitable relief, including
injunctive relief and specific performance. Such remedies will not be the
exclusive remedies for any breach of this letter agreement but will be in
addition to all other remedies available at law or equity to the Company.
12. MISCELLANEOUS
(a) Modification. The agreements set forth in this letter
agreement may be modified or waived only by a separate writing signed by the
Company and the Recipient expressly modifying or waiving such agreements.
(b) Waiver. The rights and remedies of the parties to this
letter agreement are cumulative and not alternative. Neither the failure nor any
delay by any party in exercising any right, power, or privilege under this
letter agreement will operate as a waiver of such dot, power,
Page 5
Xxxxx Xxxxxx
Confidentiality Agreement
July 29, 1999
or privilege, and no single or partial exercise of any such right, power, or
privilege will preclude any other or further exercise of such right, power, or
privilege or the exercise of any other right, power, or privilege. To the
maximum extent permitted by applicable law, (i) no claim or right arising out of
this letter agreement can be discharged by one party, in whole or in part, by a
waiver or renunciation of the claim or right unless in writing signed by the
other party; (ii) no waiver that may be given by a party will be applicable
except in the specific instance for which it is given; and (iii) no notice to or
demand on one party will be deemed to be a waiver of any obligation of such
party or of the right of the party giving such notice or demand to take further
action without notice or demand as provided in this letter agreement.
(c) Person. The term "person" means any individual,
corporation (including any non-profit corporation), general or limited
partnership, limited liability company, joint venture, estate, trust,
association, organization, labor union, or other entity or governmental body.
(d) Severability. The invalidity or unenforceability of any
provision of this letter agreement shall not affect the validity or
enforceability of any other provisions of this letter agreement, which shall
remain in full force and effect If any of the covenants or provisions of this
letter agreement are determined to be unenforceable by reason of its extent,
duration, scope or otherwise, then the parties contemplate that the court making
such determination shall reduce such extent, duration, scope or other provision
and enforce them in their reduced form for all purposes contemplated by this
letter agreement.
(e) Costs. The Recipient agrees that if it is held by any
court of competent jurisdiction to be in violation, breach, or nonperformance of
any of the terms of this letter agreement, then it will pay all costs of such
action or suit, including reasonable attorneys' fees.
(f) Assignment. The Company reserves the right to assign all
of its rights under this letter agreement, including the right to enforce all of
its terms. In the event of a Transaction that involves a sale of assets, the
Company currently intends to assign to the buyer rights to enforce the
restrictions and other obligations of this letter agreement, including the right
to enforce all of its terms.
(g) Section Headings, Construction. The headings of Sections
in this letter agreement are provided for convenience only and will not affect
its construction or interpretation. All references to "Section" or "Sections"
refer to the corresponding Section or Sections of this letter agreement unless
otherwise specified. All words used in this letter agreement will be construed
to be of such gender or number, as the circumstances require. Unless otherwise
expressly provided, the word "including" does not limit the preceding words or
terms.
(h) Jurisdiction; Service of Process. Any action or proceeding
seeking to enforce any provision of, or based on any right arising out of, this
letter agreement may be brought
Page 6
Xxxxx Xxxxxx
Confidentiality Agreement
July 29, 1999
against either of the parties in the courts of the State of new York, County of
New York, and each of the parties consent to the jurisdiction of such courts
(and of the appropriate appellate courts) in any such action or proceeding and
waives any objection to venue laid therein. Process in any action or proceeding
referred to in the preceding sentence may be served on any party anywhere in the
world.
(i) Governing Law. This letter agreement will be governed by
the laws of the State of New York without regard to conflicts of laws
principles.
(j) Counterparts. This letter agreement may be executed in one
or more counterparts, each of which will be deemed to be an original copy of
this letter agreement, and all of which, when taken together, shall be deemed to
constitute one and the same agreement.
If you are in agreement with the foregoing, please sign and return one
copy of this letter agreement, which thereupon will constitute our agreement
with respect to its subject matter.
Very truly yours,
By: /s/
Name: Xxxxxxx X. Xxxxxxxxx
Its: Chief Executive Officer
DULY EXECUTED and agreed to on July 29,1999.
By: /s/
Name: Xxxxx X. Xxxxxx
Its: Managing Partner
Page 7
